Survey: Luxury Up 8% in June, Jewelry Showed Strength and Weakness

The De Beers Jewelry Store on Rodeo Drive in Los Angeles.

In its ninth consecutive month of year-over-year gains, the SpendingPulse Luxury Index (excluding Jewelry) for June was up 8.2 percent, more in line with first quarter of the year and better than the 4.7 percent gains seen in May 2011, according to MasterCard Advisors SpendingPulse, a macroeconomic report tracking national retail and services sales.

Without providing figures, the company said in-store jewelry sales were strong for June, boosted by graduations and weddings. However, online jewelry sales fell by 12.9 percent for the month.

Overall year-over-year growth was supported by gasoline and grocery sales. But, as already noted, not all categories showed strength. For example, specialty apparel showed gains while the electronics and appliances, furniture and furnishings and department stores sectors remained in negative territory.

Enjoying its 23rd straight month in positive territory, and now in its eighth consecutive month of double-digit year-over-year growth, e-Commerce was up 15.2 percent over June 2010. However, as mentioned, not all its sub-categories showed growth. In addition to the decline in jewelry sales, The family clothing category slipped by 0.2 percent year-over-year. In contrast, online Women’s clothing sales grew by 12.2 percent year-over-year.

“As we move into the summer, discretionary spending tends to shift to vacation-related categories, usually reflected in travel sales and particularly in lodging, although we are seeing some weakness in those areas,” said Michael McNamara, VP, Research and Analysis for MasterCard Advisors SpendingPulse. “At the same time, June is peak season for weddings and graduations, and this may have helped the continuing strong growth of both luxury and jewelry sectors.”

McNamara noted that broad retail growth continued to be hampered by high gas prices, although they are coming down from their early May highs, as well as high unemployment. Those factors may have been further exacerbated in May by exceptionally wet weather in some parts of the country. “On the other hand,” he said, “unfavorable weather and high gasoline prices appear to have helped e-commerce to its eighth consecutive month of double-digit growth.”

Retailers Upbeat on Platinum Jewelry Sales

Platinum "Triad" ring that recently received an AGTA Spectrum Award in the Bridal Wear - Platinum Honors category.

Retailers are showing a renewed sense of optimism when it comes to sales of platinum jewelry, according to a recent survey by Platinum Guild International, an organization that promotes the platinum jewelry to consumers and the jewelry trade.

The survey, conducted by GFK Audits and Surveys, reports positive growth in platinum bridal jewelry sales for the first half of 2010, and a projected 3 percent increase through the end of the year.

A total of 56 percent of the 419 small chain and independent retailers surveyed plan to purchase additional platinum product through the end of 2010. In particular, they are stocking up on platinum bridal inventory as they prepare for increased engagement business during the holidays.

The strongest factor contributing to the strength of platinum sales in 2010 was the rising price of gold, PGI said. Platinum’s competitive pricing against gold attributed to 31 percent of retailers stating platinum’s price as a positive attribute, while an additional 29 percent found value in platinum’s unique properties of durability and strength.

The survey also reported that some retailers attributed platinum sales increases due to their staff suggesting platinum to customers more often than before, PGI said.

More than a quarter of the retailers surveyed are considered Preferred Platinum Partners, those who work closely with PGI to increase platinum jewelry sales.